Professional Documents
Culture Documents
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Sec. 2
1) the warehouseman is obligated to return the
very same commodity delivered to him or to
pay its value;
2) the commodity delivered is to be milled for
the owner thereof;
3) the commodity delivered is commingled with
the commodity belonging to other persons, and
the warehouseman is obligate to return
commodity of the same kind or to pay its value.
C. Requirement of License
Sec. 3
To achieve the purposes mentioned above, any
person who wants to engage in the business of
receiving commodities for storage is required
by the Act to first secure a license therefore
from the DTI
D. Duties of Bonded Warehouseman
1) insure the commodity received for storage
against fire (Sec. 6);
2) receive for storage any commodity of the
kind customarily stored by him in the
warehouse, so far as his license and the
capacity of his warehouse will permit, without
making any discrimination between the persons
desiring to avail themselves of warehouse
facilities (Sec. 8);
3) keep a complete record of all commodities
received by him, of the receipts issued
therefore, of the withdrawals, of the liquidation,
and of al the receipts returned to and cancelled
by him (Sec. 9)
2.2 Cases
Receipt of Palay for Milling
LIMJOCO
(1965)
DIRECTOR
OF
COMMERCE
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fraudulent
alteration
shall
excuse
the
warehouseman
from
any other liability to the
said persons.
5) For non-existence or misdescription of goods
(Sec. 20)
a. Liable for damages to holder of a receipt if at
time of its issue, goods not yet existed or by
failure of the goods to match desciption
b. EXCEPT:
i. Statement of the marks or labels upon them
or upon the packages containing them;
ii. Statement that the goods are of a certain
kind at that the packages containing the goods
contain goods of a certain kinds or by words of
similar import
Eg: received box said to contain... and not
box containing
6) For commingling goods (Sec. 24)
a. Shall be liable severally to each depositor for
the care and redelivery of the depositors share
of the mass of commingled goods to the same
extent and under the same circumstances as if
the goods had been kept separate
7) For issuing receipts for goods not received
(Sec. 50)
a. Shall be guilty of a crime if he issues a
receipt for goods that have not actually been
received by him or are not under his actual
control at the time of the issuance of the receipt
8) For issuing receipts containing false
statements (Sec. 51)
a. Shall be guilty of a crime if he fraudulently
issues a receipt for goods knowing that it
contains any false statement
9) For issuing duplicate receipts not so marked
(Sec. 52)
a. Guilty of crime if issues a duplicate or
additional negotiable receipt for goods knowing
that a former negotiable receipt for the same
goods or any part of them is outstanding and
uncancelled, without plainly placing upon the
face of the receipt the word duplicate
b. EXCEPT: in the case of a lost or destroyed
receipt after proceedings as provided for in Sec.
14
10) For issuing receipts for the warehousemans
goods which do not state that fact (Sec. 53)
a. Guilty of a crime if he issues a negotiable
receipt for oods deposited with or held by him
of which he knows that he is the owner, solely
or jointly or in common with others, if he fails to
state such ownership in the receipt
11) For delivery of goods without obtaining
negotiable receipt (sec. 54)
a. Guilty of a crime if he delivers gods our of his
possession knowing that a negotiable receipt is
oustanding and cancelled
b. EXCEPT:
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SEC 14.
Lost or destroyed receipts. Where
a negotiable receipt has been lost or destroyed,
a court of competent jurisdiction may order the
delivery of the goods upon satisfactory proof of
such loss or destruction and upon the giving of
a bond with sufficient sureties to be approved
by the court to protect the warehouseman from
any liability or expense, which he or any person
injured by such delivery may incur by reason of
the original receipt remaining outstanding. The
court may also in its discretion order the
payment of the warehouseman's reasonable
costs and counsel fees.
The delivery of the goods under an order of the
court as provided in this SEC, shall not relieve
the warehouseman from liability to a person to
whom the negotiable receipt has been or shall
be negotiated for value without notice of the
proceedings or of the delivery of the goods.
SEC 36.
Effect of sale. After goods have
been lawfully sold to satisfy a warehouseman's
lien, or have been lawfully sold or disposed of
because of their perishable or hazardous
nature, the warehouseman shall not thereafter
be liable for failure to deliver the goods to the
depositor or owner of the goods or to a holder
of the receipt given for the goods when they
were deposited, even if such receipt be
negotiable.
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issue
of
such
certificates
of
ownership.
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Redemption
There is no right of redemption in Chattel
Mortgage. There is only an EQUITY of
REDEMPTION.
1) Period within which equity of redemption
may be exercised.
From the date the condition of the Chattel
Mortgage is broken but BEFORE the foreclosure
sale of the collateral thereof.
> The 30-day period to foreclose a Chattel
Mortgage is the minimum period after violation
of the mortgage condition for the mortgage
creditor to cause the sale at public auction of
the mortgaged chattel AND is a period of grace
for the mortgagor to discharge the mortgage
obligation.
2) Amount to be paid.
a. The amount due on such mortgage; and
b. The costs and expenses incurred by such
breach of condition before the sale thereof.
3) Persons entitled to redeem.
a. Mortgagor;
b. A person holding a subsequent mortgage;
c. A subsequent attaching creditor.
Claim For Deficiency; Rule And Exception
Rule: A chattel mortgagee may sue for a
deficiency following foreclosure.
Exception: in the case of personal property sold
in
installments
where
the
chattel
mortgagor/vendees failure to pay covers 2 or
more installments.
4.2 Cases
Chattel Mortgage On House Not Binding On
Third Persons Not Parties To Contract
PIANSAY V DAVID (1964)
FACTS: Conrado David received a loan from
Claudia Vda. De Uy Kim. In order to secure the
loan, he executed a chattel mortgage on a
house. The chattel mortgage was registered
with the Register of Deeds. The mortgaged
house was sold to Claudia at a public auction,
which Claudia, in turn, sold to Salvador Piansay.
Meanwhile, Marcos Mangubat filed a complaint
against Conrado for collection of a loan. Marcos
levied upon the house that was in possession of
Salvador, and at the same time, demanded
payment of rentals from Salvador.
ISSUE: WON the chattel mortgage constituted in
favour of Claudia is valid
HELD: NO. Claudia had no right to foreclose the
chattel mortgage constituted in her favor,
because it was in reality a mere contract of an
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HELD: YES.
In the interpretation and
construction of a statute, the intent of the lawmaker should always be ascertained and given
effect. In enacting Act No. 1508, the primary
aim of the law-making body was undoubtedly to
promote business and trade and to give
impetus to the economic development of the
country. Bearing this in mind, it could not have
been the intention of the Philippine Commission
to apply the provision of SEC 7 to stores open to
the public for retail business, where the goods
are constantly sold and substituted with new
stock.
A stipulation in the mortgage, extending its
scope and effect to after-acquired property, is
valid and binding where the after-acquired
property is in renewal of, or in substitution for,
goods on hand when the mortgage was
executed, or is purchased with the proceeds of
the sale of such goods.
In other words, a mortgage may be made to
include future acquisitions of goods to be added
to the original stock mortgaged, but the
mortgage must expressly provide that such
future acquisitions shall be held as included in
the mortgage.
In sum, the court held:
1) That the provision of the last paragraph of
SEC 7 of Act No. 1508 is not applicable to drug
stores, bazaars and all other stores in the
nature of a revolving and floating business; and
2) That the stipulation in the chattel mortgages
in question, extending their effect to afteracquired property, is valid and binding.
After-Incurred Obligation
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Specific Performance
SOUTHERN MOTORS V MOSCOSO (1961)
FACTS: Private respondent Southern Motors,
Inc. sold to petitioner Angel Moscoso a
Chevrolet truck. Upon making a down payment,
Angel executed a promissory note and a chattel
mortgage on the truck.
Upon the failure of Angel to pay the
installments, Southern Motors filed a complaint
against Angel, to recover the unpaid balance of
the purchase price. A writ of attachment was
issued by the lower court and the Chevrolet
truck and a house and lot belonging to Angel
were attached by the sheriff. The sheriff then
sold the truck at a public auction in which
Southern Motors was the only bidder.
The trial court then condemned Angel to pay
Southern Motors the deficiency.
Angel questions this order of the court and
alleged that the attachment caused to be levied
on the truck and its immediate sale at public
auction, was tantamount to the foreclosure of
the chattel mortgage on said truck.
Southern Motors counters and claims that in
filing the complaint, it chose to exact fulfilment
of the obligation (specific performance) and is
thus entitled to sue for the unpaid balance of
the purchase price.
ISSUE: WON the deficiency of the purchase
price can still be recovered
HELD: YES. The case is governed by Art. 1484
of the New Civil Code. (SEE Art. 1484, NCC)
Southern Motors had chosen the first remedy.
The complaint is an ordinary civil action for
recovery of the remaining unpaid balance die
on the promissory note. This is shown by the
following circumstances:
1) Southern Motors had not adopted the
procedure or methods outlined by Sec. 14 of
the Chattel Mortgage Law but those prescribed
for ordinary civil actions
2) Southern Motors not only attached the truck
but also the house and lot of Angel.
Nothing unlawful or irregular in Southern
Motors act of attaching the mortgaged truck
itself. As Southern Motors has chosen to exact
the fulfilment of Angels obligation, the former
may enforce execution of the judgment
rendered in its favor on the personal and real
No Recourse
Property
Against
Additional
Mortgaged
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an
actual
HELD: NO.
Where the mortgagee elects a
remedy of foreclosure, the law requires the
actual foreclosure of the mortgaged chattel.
It is actual sale of the mortgaged chattel in
accordance with Sec. 14 of Act No. 1508 that
would bar the creditor (who chooses to
foreclose) from recovering any unpaid balance.
And it is deemed that there has been
foreclosure of the mortgage when all the
proceedings of the foreclosure, including the
sale of the property at public auction, have
been accomplished.
Be that as it may, although no actual
foreclosure as contemplated under the law has
taken place in this case, since the vehicle is
already in the possession of Magna and it has
persistently and consistently elected the
remedy of foreclosure, the Court of Appeals,
thus, ruled correctly in directing the foreclosure
of the said vehicle without more.
PD 1417
Further Amending SEC 198 Of The Revised
Administrative Code As Amended By
Republic Act Nos. 116 And 2711, By
Increasing
The
Fees
Collectible
In
Connection With Registration Of Chattel
Mortgages
WHEREAS, there has been an unprecedented
increase in the cost of equipment, materials
and supplies used by the Land Registration
Commission;
WHEREAS, it is in consonance with sound fiscal
policy that the registration fees collectible by
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P300,000.00 .. 1,250.00
(7)
P300,000.00 or more but less
than
P400,000.00 .. 1,500.00
(8)
P400,000 or more but less than
P500,000.00 .. 1,750.00
(9)
P500,000.00 or more but not
more than
P100,000,000.00 ... 2,000.00
(10)
For each P1,000.00 in excess of
P1,000,000.00.. 10.00
(SEC 7 (c), Rule 141, Rules of Court, as
amended by A.M. No. 00-2-01-SC, February 1,
2000).
Cooperatives, thrift banks, and rural banks are
not exempt from the payment of filing fees and
other fees under these guidelines (A.M. No. 989-280-RTC, September 29, 1998; A.M. No. 99-393-RTC, April 20, 1999; and A.M. No. 92-9-4080).
d. In case the application is for the extra-judicial
foreclosure of mortgages of real estates and/or
chattels in different locations covering one
indebtedness, issue, apart from the official
receipt for the fees, a certificate of payment
indicating the amount of indebtedness, the
filing fees collected, the mortgages sought to
be foreclosed, the real estates and/or chattels
mortgaged and their respective locations, for
purposes of having the application docketed
with the Clerks of Court in the places where the
other properties are located and of allowing the
extra-judicial foreclosure to proceed thereat.
(A.M. No. 99-10-05-0, par. 2(e)).
Sec. 3. The application for extra-judicial
foreclosure shall be raffled under the
supervision of the Executive Judge, with the
assistance of the Clerk of Court and Ex-Oficio
Sheriff, among all Sheriffs including those
assigned to the Office of the Clerk of court and
Sheriffs assigned in the branches of the court. A
Sheriff to whom the case has been raffled shall
be excluded in the succeeding raffles and shall
participate again only after all other Sheriffs
shall have been assigned a case by raffle
(Administrative Circular No. 3-98, Feb. 5, 1998).
Sec. 4. The Sheriff to whom the application for
extra-judicial foreclosure of mortgage was
raffled shall do the following:
a.
Prepare a Notice of Extra-judicial Sale
using the following form:
NOTICE OF EXTRA-JUDICIAL SALE
Upon extra-judicial petition for sale under Act
3135 / 1508 filed __________________ against
(name and address of Mortgator/s) to satisfy the
mortgage indebtedness which as of ___________
amounts to P _________________, excluding
penalties,
charges,
attorneys
fees
and
expenses of foreclosure, the undersigned or his
duly authorized deputy will sell at public auction
on (date of sale) _______________ at 10:00 A.M.
or soon thereafter at the main entrance of the
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Redemption
Who may redeem
1) the debtor
2) his successor in interest
3) any judicial creditor having an interest
4) any person having a lien on the property
subsequent to the mortgage under which the
property is sold.
Period of Redemption
One year from the date of the registration of
certificate of sale.
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of
Right of Redemption
Governing Law
Governed by Rule 68
of the Rules of Court
Applicability
1.
in
judicial
foreclosure of REM;
2. in EJF of REM
involving a bank as a
mortgagee
and
a
juridical person as a
mortgagor
To whom conferred
Conferred by law only
to the mortgagor but
acquired by second
mortgagee since his
right is subordinate to
the first mortgagee.
Period
Can
be
exercised
within a period of not
less than 90 days nor
more than 120 days
from
entry
of
judgment or even after
foreclosure of sale but
prior to confirmation.
When Exercised
Can be exercised after
entry of judgment but
before foreclosure sale
and after foreclosure
sale
but
prior
to
confirmation of sale.
Redemption Price
Redemption
price
depends
on
the
judgment of the court
as to the amount due
to
plaintiff
upon
mortgage debt with
interest and charges
approved by the court
and costs.
5.2 Cases
Redemption
price
depends
on
the
purchase price as fixed
in Sec 26 Rule 39 ROC
except in cases under
SEC 78 of the General
Banking
Law,
the
amount
and
the
interest to be paid by
the mortgagor will be
the amount due and
the rate stipulated in
the mortgage loan not
the purchase price and
legal interest under
the ROC.
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damages
with
injunction.
Respondents
contended that the foreclosure sale is null and
void because: (1) the obligation is yet to mature
as there were negotiations for an additional
loan amount; (2) lack of publication; (3) the
purchase price was grossly inadequate and
unconscionable; and (4) the foreclosure
proceedings were initiated by petitioner in bad
faith.
RTC ordered the annulment and setting aside of
the foreclosure proceedings and auction sale on
the ground that there was lack of
publication of the notice of sale. Petitioner
appealed to the CA. CA dismissed petitioners
appeal with regard to the Forbes Park property
as the same was already the subject of a Deed
of Reconveyance executed by petitioner in
favor of respondents as well as a Compromise
Agreement dated between the same parties.
As to the Malugay property, CA affirmed the
RTC decision.
ISSUE: WON the parties to the mortgage can
validly waive the posting and publication
requirements mandated by Act No. 3135.
HELD
NO.
Act. No. 3135, as amended,
governing
extrajudicial
foreclosure
of
mortgages on real property is specific with
regard to the posting and publication
requirements of the notice of sale, to wit:
Sec. 3. Notice shall be given by posting notices
of the sale for not less than twenty days in at
least three public places of the municipality or
city where the property is situated, and if such
property is worth more than four hundred
pesos, such notice shall also be published once
a week for at least three consecutive weeks in a
newspaper of general circulation in the
municipality or city.
On this score, it is well settled that what Act No.
3135 requires is: (1) the posting of notices of
sale in three public places; and, (2) the
publication of the same in a newspaper of
general circulation. Failure to publish the notice
of sale constitutes a jurisdictional defect, which
invalidates the sale.
Petitioner and
respondents have absolutely no right to waive
the posting and publication requirements of Act
No. 3135. While it is established that rights
may be waived, Article 6 of the Civil Code
explicitly provides that such waiver is subject to
the condition that it is not contrary to law,
public order, public policy, morals, or good
customs, or prejudicial to a third person with a
right recognized by law.
The principal object of a notice of sale in a
foreclosure of mortgage is not so much to notify
the mortgagor as to inform the public generally
OUANO V CA (2003)
FACTS: Julieta M. Ouano obtained a loan from
the PNB in the amount of P104,280.00. As
security for said loan, she executed a real
estate mortgage over two parcels of land. She
defaulted on her obligation. PNB filed a petition
for extrajudicial foreclosure with the City Sheriff
of Mandaue City. The sheriff prepared a notice
of sale setting the date of public auction of the
two parcels of land on December 5, 1980 at
9:00 a.m. to 4:00 p.m. He caused the notice to
be published in the Cebu Daily Times, a
newspaper of general circulation in Mandaue
City, in its issues of November 13, 20 and 27,
1980. He likewise posted copies thereof in
public places in Mandaue City and in the place
where the properties are located. However, the
sale as scheduled and published did not take
place as the parties, on four separate dates,
executed Agreements to Postpone Sale
(Agreements). These Agreements were
addressed to the sheriff, requesting the latter to
defer the auction sale to another date at the
same time and place, without any further
republication of the Notice. In all the
postponements, no new notice of sale was
issued, nor was there any republication or
reposting of notice for the rescheduled dates.
Finally, on May 29, 1981, the sheriff conducted
the auction sale, awarding the two parcels of
land to PNB, the only bidder. He executed a
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Be
Paid
By
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of
VI.
BANGKO
PILIPINAS LAW
RA 7653
6.1 Topics
State Policies
SENTRAL
NG
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departments
performing
supervision
and
examination functions against all costs and
expenses reasonably incurred by such persons
in connection with any civil or criminal action,
suit or proceedings to which he may be, or is,
made a party by reason of the performance of
his functions or duties, unless he is finally
adjudged in such action or proceeding to be
liable for negligence or misconduct.
In the event of a settlement or compromise,
indemnification shall be provided only in
connection with such matters covered by the
settlement as to which the Bangko Sentral is
advised by external counsel that the person to
be indemnified did not commit any negligence
or misconduct.
The costs and expenses incurred in defending
the aforementioned action, suit or proceeding
may be paid by the Bangko Sentral in advance
of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by
or on behalf of the member, officer, or
employee to repay the amount advanced
should it ultimately be determined by the
Monetary Board that he is not entitled to be
indemnified as provided in this subSEC.
SEC 16. Responsibility. Members of the
Monetary Board, officials, examiners, and
employees of the Bangko Sentral who willfully
violate this Act or who are guilty of negligence,
abuses or acts of malfeasance or misfeasance
or fail to exercise extraordinary diligence in the
performance of hi duties shall be held liable for
any loss or injury suffered by the Bangko
Sentral or other banking institutions as a result
of
such
violation,
negligence,
abuse,
malfeasance, misfeasance or failure to exercise
extraordinary diligence.
Similar responsibility shall apply to members,
officers, and employees of the Bangko Sentral
for:
(1) the disclosure of any information of a
confidential nature, or any information on the
discussions or resolutions of the Monetary
Board, or about the confidential operations of
the Bangko Sentral, unless the disclosure is in
connection with the performance of official
functions with the Bangko Sentral, or is with
prior authorization of the Monetary Board or the
Governor; or
(2) the use of such information for personal gain
or to the detriment of the Government, the
Bangko Sentral or third parties: Provided,
however, That any data or information required
to be submitted to the President and/or the
Congress, or to be published under the
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2.
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as receiver.
The receiver shall immediately gather and take
charge of all the assets and liabilities of the
institution, administer the same for the benefit
of its creditors, and exercise the general powers
of a
receiver under the Revised Rules of Court but
shall not, with the exception of administrative
expenditures, pay or commit any act that will
involve the transfer or disposition of any asset
of the institution: Provided, That the receiver
may deposit or place the funds of the institution
in nonspeculative investments. The receiver
shall determine as soon as possible, but not
later than ninety (90) days from take over,
whether the institution may be rehabilitated or
otherwise placed in such a condition so that it
may be permitted to resume business with
safety to its depositors and creditors and
the general public: Provided, That any
determination for the resumption of business of
the institution shall be subject to prior approval
of the Monetary Board.
If the receiver determines that the institution
cannot be rehabilitated or permitted to resume
business in accordance with the next preceding
paragraph, the Monetary Board shall notify in
writing the board of directors of its findings and
direct the receiver to proceed with the
liquidation of the institution. The receiver shall:
1. file ex parte with the proper regional trial
court, and without requirement of prior notice
or any other action, a petition for assistance in
the liquidation of the institution pursuant to a
liquidation plan adopted by the Philippine
Deposit Insurance Corporation for general
application to all closed banks. In case of quasibanks, the liquidation plan shall be adopted by
the Monetary Board. Upon acquiring jurisdiction,
the court shall, upon motion by the receiver
after due notice, adjudicate disputed claims
against the institution, assist the enforcement
of individual liabilities of the stockholders,
directors and officers, and decide on other
issues as may be material to implement the
liquidation plan adopted. The receiver shall pay
the cost of the proceedings from the assets of
the institution.
2. convert the assets of the institutions to
money, dispose of the same to creditors and
other parties, for the purpose of paying the
debts of such institution in accordance with the
rules on concurrence and preference of credit
under the Civil Code of the Philippines and he
may, in the name of the institution, and with
the assistance of counsel as he may retain,
institute such actions as may be necessary to
collect and recover accounts and assets of, or
defend any action against, the institution. The
assets of an institution under receivership or
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SEC
63.
Action
When
Abnormal
Movements
Occur
in
the
Monetary
Aggregates, Credit, or Price Level.
Whenever abnormal
movements
in the
monetary aggregates, in credit, or in
prices endanger the stability of the Philippine
economy or important sectors thereof, the
Monetary Board
shall:
(a) take such remedial measures as are
appropriate and within the powers granted to
the
Monetary Board and the Bangko Sentral under
the provisions of this Act; and
(b) submit to the President of the Philippines
and the Congress, and make public, a detailed
report which shall include, as a minimum, a
description and analysis of:
(1) the causes of the rise or fall of the monetary
aggregates, of credit or of prices;
(2) the extent to which the changes in the
monetary aggregates, in credit, or in prices
have been reflected in changes in the level of
domestic output, employment, wages
and economic activity in general, and the
nature and significance of any such
changes; and
(3) the measures which the Monetary Board has
taken and the other monetary, fiscal or
administrative measures which it recommends
to be adopted.
Whenever the monetary aggregates, or the
level of credit, increases or decreases by more
thanfifteen percent (15%), or the cost of living
index increases by more than ten percent
(10%), in relation to the level existing at the
end of the corresponding month of the
preceding year, or even though any of these
quantitative guidelines have not been reached
when in its judgment the circumstances so
warrant, the Monetary Board shall submit the
reports mentioned in this SEC, and shall state
therein whether, in the opinion of the Board,
said changes in the monetary aggregates,
credit or cost of living represent a threat to the
stability of the Philippine economy or of
important sectors thereof.
The Monetary Board shall continue to submit
periodic reports to the President of the
Philippines and to Congress until it considers
that the monetary, credit or price disturbances
have disappeared or have been adequately
controlled.
SEC
64.
International
Monetary
Stabilization. The Bangko Sentral shall
exercise its powers under this Act to preserve
the international value of the peso and to
maintain its convertibility into other freely
convertible currencies primarily for, although
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Documents
rediscounted,
discounted
or
accepted as
collateral by the Bangko Sentral must be
withdrawn by the borrowing institution on the
dates of their
maturities, or upon liquidation of the obligations
which they represent or to which they relate
whenever
said obligations have been liquidated prior to
their dates of maturity.
Banks shall have the right at any time to
withdraw any documents which they have
presented to
the Bangko Sentral as collateral, upon payment
in full of the corresponding debt to the Bangko
Sentral,
including interest charges.
SEC 88. Other requirements. The
Monetary Board may prescribe, within the
general
powers granted to it under this Act, additional
conditions which borrowing institutions must
satisfy in
order to have access to the credit of the Bangko
Sentral. These conditions may refer to the rates
of
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ARTICLE
II.
THE
MARKETING
AND
STABILIZATION OF SECURITIES FOR THE
ACCOUNT OF THE GOVERNMENT
A.
THE
ISSUE
AND
PLACING
OF
GOVERNMENT SECURITIES
SEC 117. Issue of Government Obligations.
The issue of securities representing
obligations of the Government, its political
subdivisions or instrumentalities, may be made
through the
Bangko Sentral, which may act as agent of, and
for the account of, the Government or its
respective
subdivisions or instrumentality, as the case may
be: Provided, however, That the Bangko Sentral
shall
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Instruments of action
Setting of bank reserve requirements
SEC 94. Reserve Requirements. In order
to control the volume of money created by
the credit operations of the banking system, all
banks operating in the Philippines shall be
required to
maintain reserves against their deposit
liabilities: Provided, That the Monetary Board
may, at its
discretion, also require all banks and/or quasibanks to maintain reserves against funds held
in trust and
liabilities for deposit substitutes as defined in
this Act. The required reserves of each bank
shall be
proportional to the volume of its deposit
liabilities and shall ordinarily take the form of a
deposit in the
Bangko Sentral. Reserve requirements shall be
applied to all banks of the same category
uniformly and
without discrimination.
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PACIFIC
BANKING
CORPORATION
EMPLOYEES ORGANIZATION, et al vs. CA
G.R. No. 109373
20 March 1995
Held:
Distinction Between an Ordinary Action and a
Special Proceeding:
It was necessary in this case to classify what
was filed-- whether it was an ordinary action or
a special proceedingbecause the two have
different periods for appeal.
Action is the act by which one sues another in a
court of justice for the enforcement or
protection of a right, or the prevention or
redress of the wrong; while special proceeding
is the act by which one seeks to establish the
status or right of a party, or a particular fact.
A petition for liquidation of an insolvent
corporation is a special proceeding.
It does not seek the enforcement or protection
of a right nor the prevention or redress of a
wrong against a party.
It does not pray for affirmative relief for an
injury arising from a partys wrongful act or
omission nor state a cause of action that can be
enforced against any person.
The petition only seeks a declaration of the
corporations state of insolvency and the
concomitant right of creditors and the order of
payment of their claims in the disposition of the
corpos assets.
Different from an Interpleader
An Interpleader involves claims on a subject
matter against a person who has no interest
therein.
Not the case in liquidation proceedings where
the Liquidator, as representative of the
corporation, takes charge of its assets and
liabilities for the benefit of the creditors.
Appeal
As in settlement of the estate of the deceased,
multiple appeals are allowed. The several
claims of the creditors are separate ones and a
decision or final order with respect to any claim
can be appealed.
In special proceedings, unlike in ordinary
actions, a record on appeal must be filed in
order for the appeal to be perfected. This is
because the original record of the case must
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Concept of Intermediation
Distinction between banks and quasibanks
SEC 2. Declaration of Policy. The State
recognizes the vital role of banks in providing
an environment conducive to the sustained
development of the national economy and the
fiduciary nature
of banking that requires high standards of
integrity and performance. In furtherance
thereof, the State
shall promote and maintain a stable and
efficient banking and financial system that is
globally
competitive, dynamic and responsive to the
demands of a developing economy. (n)
SEC 4. Supervisory Powers. The
operations and activities of banks shall be
subject to
supervision of the Bangko Sentral. "Supervision"
shall include the following:
4.1. The issuance of rules of conduct or the
establishment of standards of operation for
uniform
application to all institutions or functions
covered,
taking
into
consideration
the
distinctive
character of the operations of institutions and
the substantive similarities of specific functions
to which such rules, modes or standards are to
be applied;
4.2. The conduct of examination to determine
compliance with laws and regulations if the
circumstances so warrant as determined by the
Monetary Board;
4.3. Overseeing to ascertain that laws and
regulations are complied with;
4.4. Regular investigation which shall not be
oftener than once a year from the last date of
examination
to
determine
whether
an
institution is conducting its business on a safe
or
sound
basis:
Provided,
That
the
deficiencies/irregularities
found
by
or
discovered by an audit
shall be immediately addressed;
4.5. Inquiring into the solvency and liquidity of
the institution (2-D); or
4.6. Enforcing prompt corrective action. (n)
The Bangko Sentral shall also have supervision
over the operations of and exercise regulatory
powers over quasi-banks, trust entities and
other financial institutions which under special
laws are
subject to Bangko Sentral supervision. (2-Ca)
For the purposes of this Act, "quasi-banks" shall
refer to entities engaged in the borrowing of
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Distinction between
commercial banks
universal
banks
and
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Distinction
between
universal
commercial banks and other banks
banks
or
allied
and
non-allied
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Stock corporation
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the
DOSRI
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of
casual
and
probationary
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for
faithful
SEC
84.
Deposit
for
the
Faithful
Performance of Trust Duties. Before
transacting
trust business, every trust entity shall deposit
with the Bangko Sentral as security for the
faithful
performance of its trust duties, cash or
securities approved by the Monetary Board in
an amount equal to
not less than Five hundred thousand pesos
(P500,000.00) or such higher amount as may be
fixed by the
Monetary Board: Provided, however, That the
Monetary Board shall require every trust entity
to increase
the amount of its cash or securities on deposit
with the Bangko Sentral whenever in its
judgment such
increase is necessary by reason of the trust
business of such entity: Provided, further, That
the paid-in
capital and surplus of such entity must be at
least equal to the amount required to be
deposited with the
Bangko Sentral in accordance with the
provisions of this paragraph. Should the capital
and surplus fall
below said amount, the Monetary Board shall
have the same authority as that granted to it
under the
provisions of the fifth paragraph of SEC 34 of
this Act.
A trust entity so long as it shall continue to be
solvent and comply with laws or regulations
shall
have the right to collect the interest earned on
such securities deposited with the Bangko
Sentral and,
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of trust
business
from
general
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BANKING
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VIII.
PHILIPPINE
DEPOSIT
INSURANCE CORPORATION ACT
Basic Policy (Sec.1)
To promote and safeguard the interests of the
depositing public by way of providing
permanent and continuing insurance coverage
on all insured deposits.
Main Functions
1. Insurance of Banks (Sec.5)
To insure the deposit liabilities of any bank or
banking institution engaged in the business of
receiving deposits or which thereafter may
engage in the business of receiving deposits.
2. Examination of Banks (Sec. 8 and 9)
To conduct examination of banks with prior
approval
of
the
Monetary
Board.
No
examination can be conducted within twelve
months from the last examination date.
The Board of Directors shall appoint examiners
who shall have power, on behalf of the PDIC to
examine any insured bank. Such examiner shall
have the power to make a thorough
examination of all the affairs of the bank and in
doing so, he shall have the power to administer
oaths, to examine and take and preserve the
testimony of any of the officers and agents
thereof, and, to compel the presentation of
books, documents, papers, or records necessary
in his judgment to ascertain the facts relative to
the condition of the bank; and shall make a full
and detailed report of the condition of the bank
to the PDIC.
The Board of Directors shall appoint claim
agents who shall have the power to investigate
and examine all claims for insured deposits and
transferred deposits. Each claim agent shall
have the power to administer oaths and to
examine under oath and take and preserve
testimony of any person relating to such claim
3. Rehabilitation of Banks (Sec.17)
Money of the PDIC not otherwise employed shall
be invested in obligations of the Republic of the
Philippines or in obligations guaranteed as to
principal and interest by the Republic of the
Philippines.
The banking or checking accounts of the PDIC
shall be kept with the Bangko Sentral ng
Pilipinas, with the Philippine National Bank, or
with any other bank designated as depository or
fiscal agent of the Philippine government.
4. Receivership of Closed Banks (Sec.10)
The PDIC as receiver shall control, manage and
administer the affairs of the closed bank.
Effective immediately upon takeover as
receiver of such bank, the powers, functions
and duties, as well as all allowances,
remunerations and perquisites of the directors,
officers, and stockholders of such bank are
suspended, and the relevant provisions of the
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Liability to Depositors
1. Deposit Liabilities Required to be Insured
(Sec.5)
The deposit liabilities of any bank or banking
institution, which is engaged in the business of
receiving deposits or which thereafter may
engage in the business of receiving deposits,
shall be insured with the PDIC.
2. Commencement of Liability (Sec.14)
Whenever an insured bank shall have been
closed by the Monetary Board, payment of the
insured deposits on such closed bank shall be
made by the PDIC as soon as possible either (1)
by cash or (2) by making available to each
depositor a transferred deposit in another
insured bank in an amount equal to insured
deposit of such depositor.
The PDIC, in its discretion, may require proof of
claims to be filed before paying the insured
deposits, and that in any case where the PDIC is
not satisfied as to the viability of a claim for an
insured
deposit,
it
may
require
final
determination of a court of competent
jurisdiction before paying such claim.
Failure to settle the claim, within six (6) months
from the date of filing of claim for insured
deposit, where such failure was due to grave
abuse of discretion, gross negligence, bad faith,
or malice, shall, upon conviction, subject the
directors, officers or employees of the PDIC
responsible for the delay, to imprisonment from
six (6) months to one (1) year. The period shall
not apply if the validity of the claim requires the
resolution of issues of facts and or law by
another office, body or agency including the
case mentioned in the first proviso or by the
PDIC together with such other office, body or
agency.
3. Deposit Accounts Not Entitled to
Payment (Sec.4(f))
Any obligation of a bank which is payable at the
office of the bank located outside of the
Philippines shall not be a deposit or included as
part of the total deposits or of insured deposit.
Subject to the approval of the Board of
Directors,
any
insured
bank
which
is
incorporated under the laws of the Philippines
which maintains a branch outside the
Philippines may elect to include for insurance its
deposit obligations payable only at such branch.
4. Liability for Contents of Safety Box
Not liable the Bank has no way of knowing
what a depositor places in his security deposit
box (Catindig).
5. Determination of Insured Deposits
(Sec.16)
The PDIC shall commence the determination of
insured deposits due the depositors of a closed
bank upon its actual takeover of the closed
bank.
6. Calculation of Liability (Sec. 4(g))
Per Depositor, Per Capacity
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IX.
LAW ON SECRECY OF BANK
DEPOSITS
Purpose
To encourage people to deposit their money in
banks and thereby discourage private hoarding
so that the banks may lend out the money and
assist in the economic development of the
country.
Prohibited Acts
1. The examination and inquiry or looking
into all deposits of whatever nature with
banks in the Philippines (including
investments in bonds issued by the
Government)
by
any
person,
government, bureau or office.
2. The disclosure by any official or
employee
of
any
bank
to
any
unauthorized person of any information
concerning said deposits.
Exceptions
1. Upon written permission of the depositor
2. In cases of impeachment
3. Upon order of a competent court in
cases of bribery or dereliction of duty of
a public official
4. In cases where the money deposited or
invested is the subject matter of the
litigation
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6.
7.
8.
9.
10.
11.
3.
4.
5.
6.
7.
8.
9.
10.
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Excluded transactions
Sec. 3, CB Circular 158
a) Those that do not involve the payment
of any finance charge by the debtor; and
b) Those in which the debtor is the one
specifying a definite and fixed set of
credit terms such as bank deposits,
insurance contracts, sale of bonds, etc.
Finance and non-finance charges
Finance charges
SEC 3. As used in this Act, the term
(3) "Finance charge" includes interest, fees,
service charges, discounts, and such other
charges incident to the extension of credit as
the Board may be regulation prescribe.
Sec. 2 (h), CB Circular 158
Finance charges are the amounts to be paid by
the debtor incident to the extension of credit
such as interests, discounts, collection fees,
credit investigation fees and attorneys fees.
Non-finance charges
Sec. 2(f), CB Circular 158
Non-finance charges are the amounts advanced
by a creditor for items normally associated with
the ownership of property or the availment of
the services purchased which are not incident
to the extension of credit. For example, when a
debtor purchases a car on credit, the creditor
may advance the insurance premium as well as
the registration fee for the account of the
debtor.
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non-compliance
with
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1) A statement, in a conspicuous
and prominent location on the
application
or
solicitation,
that:
i. the
information
is
accurate as of the date
the
application
or
solicitation was printed;
ii. the information contained
in the application or
solicitation is subject to
change after such date;
iii. the
applicant
should
contact the creditor for
information on any change
in
the
information
contained
in
the
application or solicitation
since it was printed;
2) The date the application or
solicitation was printed; and
3) In
a
conspicuous
and
prominent location on the
application or solicitation, a
toll free telephone number or
mailing address which the
applicant may contact to
obtain any change in the
information provided in the
application
or
solicitation
since it was printed.
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Governing contracts
a) Issuing
bank
and
applicant/buyer/importer
Their
relationship is governed by the terms of
the application and agreement for the
issuance of the letter of credit by the
bank
b) Issuing
bank
and
beneficiary/seller/exporter
Their
relationship is governed by the terms of
the letter of credit issued by the bank
c) Applicant and beneficiary Their
relationship is governed by the sales
contract. (See Reliance Commodities v.
Deawoo Industrial)
Opening bank buyers bank which issues the
letter of credit
Notifying bank corresponding bank of the
opening bank through which it advises the
beneficiary of the existence of the letter of
credit
Negotiating bank any bank in the city of the
beneficiary
Paying bank - buys or discounts the drafts if
such draft is drawn on the opening bank or on
another designated bank not in the city of the
beneficiary
Confirming bank upon the request of the
beneficiary confirms the letter of credit issued
by the opening bank
Independence principle
The independence principle in a letter of credit
transactions means that a bank, in determining
compliance with the terms of a letter of credit is
required to examine only the shipping
documents presented by the seller and is
precluded from determining whether the main
contract is actually accomplished or not. This
arrangement assures the seller of prompt
payment, independent of any breach of the
main sales contract. (See Bank of America NT &
SA).
Rule of strict compliance
The rule of strict compliance in a letter of credit
transaction
means
that
the
documents
tendered by the seller or beneficiary must
strictly conform to the terms of the letter of
credit, i.e., they must include all documents
required by the letter of credit. Thus, a
correspondent bank which departs from what
has been stipulated under the letter of credit,
as when it accepts a faulty tender, acts on its
own risk and may not thereafter be able to
recover from the buyer or the issuing bank, as
the case may be; the money thus paid to the
beneficiary. (See Feati Bank)
Documents associated
credit transactions
with
letters
of
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5.
Negotiating bank any bank in the city
of the beneficiary
6.
Paying bank buys or discounts the
drafts if such draft is drawn on the opening
bank or on another designated bank not in the
city of the beneficiary
7.
Confirming bank upon the request of
the beneficiary confirms the letter of credit
issued by the opening bank
Standby letters of credit
Transfield Philippines, Inc. v. Luzon Hydro
Corporation
Facts: Transfield Philippines and LHC entered
into a turnkey contract whereby the former
undertook to construct a hydro-electric power
station by June 1, 2000. To secure performance
of the obligation on or before the target
completion date, Transfield opened in favor of
LHC 2 standby letters of credit. Transfeild failed
to complete the project by the target date.
Transfield filed a Complaint for Injunction to
restrain LHC from calling on the securities.
Issue: WON the banks should dispose of the
securities upon application by LHC? Yes.
Held:
Concept of Standby letters of credit The use of
credits in commercial transactions serves to
reduce the risk of non-payment of the purchase
price under the contract of sale of goods.
Standby credits however are used in non-sale
settings where they serve to reduce the risk of
non-performance.
Commercial credit v. standby credit
1. Commercial credit involve of payment of
money under a contract of sale.
2. Commercial credits become payable
upon the presentation by the seller of
documents that show he has taken
affirmative steps to comply with the
sales agreement. Standby credits is
payable upon certification of a partys
nonperformance of the agreement.
3. Beneficiary of commercial credit must
present
documents
that
he
has
performed
his
contract.
While
beneficiary of standby credit must certify
that his obligor has not performed the
contract.
Independence principle
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Rights of entruster
SEC 7. Rights of the entruster. The entruster
shall be entitled to the proceeds from the sale
of the goods, documents or instruments
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XIII.
MERCHANTS
COMMERCIAL TRANSACTIONS
CODE OF COMMERCE (1888)
AND
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ARTICLE 3.
The legal presumption of
habitually engaging in commerce shall exist
from the moment the person who intends to
engage therein announces through circulars,
newspapers, handbills, posters exhibited to the
public, or in any other manner whatsoever, an
establishment which has for its object some
commercial operation.
ARTICLE 4. Persons who possess the following
qualifications shall have legal capacity to
habitually engage in commerce:
1. Having completed the age of twenty-one
years.
2. Not being subject to the authority of the
father or of the mother nor to marital authority.
3. Having the free disposition of their
property.
ARTICLE 5. Those under twenty-one years of
age and those incapacitated may continue,
through their guardians, the business engaged
in by their parents or their predecessors. If the
guardians do not have legal capacity to trade or
are under some disqualifications, they shall be
obliged to appoint one or more factors having
the legal qualifications who shall substitute
them in conduct of the business.
ARTICLE 6. (Repealed) 1
ARTICLE 7. (Repealed) 2
ARTICLE 8. The husband may freely revoke the
authorization impliedly or expressly granted to
his wife to trade, stating the revocation in a
public instrument which shall also be recorded
in the commercial registry, published in the
official periodical of the town, if there be one, or
otherwise in that of the town, if there be one, or
otherwise in that of the province, and
announced to her correspondents by means of
circulars. The publication may also be made, if
the husband so demands, by proclamations and
common criers.
This revocation may, in no case,
prejudice rights acquired before its publication
in the official periodical.
ARTICLE
ARTICLE
ARTICLE
ARTICLE
9. (Repealed) 3
10. (Repealed) 4
11. (Repealed) 5
12. (Repealed) 6
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AND
BOOKKEEPING
OF
COMMERCE
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The
merchant
shall,
furthermore,
prepare annually and enter in the same book
the general balance of his business, with the
details mentioned in this article, and in
accordance with the entries in the journal,
without any reservations or omissions, under
his signature and responsibility.
ARTICLE 38. In the journal shall be entered as
the first item the result of the inventory
mentioned in the preceding article, divided into
one or various consecutive accounts, according
to the system of bookkeeping adopted.
Thereafter, all his operations shall follow
day by day, each entry stating the credit and
debit
of
the
respective
accounts.
When the operations are numerous,
whatever their importance may be, or when
they have taken place outside the domicile,
those referring to each account and which have
taken place in each day may be included in a
single entry, but observing in their statement, if
itemized, the same order in which they took
place.
Likewise, the amounts which the
merchant uses for his household expenses shall
be entered on the date on which they are
withdrawn from the funds, and they shall be
carried into a special account to be opened for
that purpose in the ledger.
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IV - GENERAL PROVISIONS
COMMERCIAL CONTRACTS
RELATING
TO
ARTICLE 50.
Commercial contracts, in
everything
relative
to
their
requisites,
modifications, exceptions, interpretations and
extinction and to the capacity of the contracting
parties, shall be governed in all matters not
expressly provided for in this Code or in special
laws, by the general rules of the civil law.
[Telegraphic correspondence shall only be the
basis of an obligation between contracting
parties who have previously admitted this
medium in a written contract, and provided the
telegrams fulfill the conventional conditions or
conventional signs which may have been
previously fixed and agreed to by the
contracting parties.]
ARTICLE 51. Commercial contracts shall be
valid and shall give rise to obligations and
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the other defendants were the partners of LoChim-Lim in the said lumber yard business.
Held:
As far as the evidence shows it seems
that the business was conducted by Lo-ChimLim in his own name, although he gave to the
appellants a share of the earnings of the
business; but what that share was has not been
shown with certainty. The contracts made with
the plaintiff were made by Lo-Chim-Lim
individually in his own name, and there is no
evidence that the partnership ever contracted
in any other form. Under such circumstances we
find nothing upon which to consider this
partnership other than as a partnership of
cuentas en participacion. It may be that, as a
matter of fact, it is something different, but the
uncertain and scant evidence introduced by the
parties does not permit of any other designation
of this partnership. We see nothing, according
to the evidence, but a simple business
conducted by Lo-Chim-Lim exclusively, in his
own name, the names of other persons
interested in the profits and losses of the
business nowhere appearing.
A partnership constituted in such a
manner, the existence of which was only known
to those who had an interest in the same, there
being no mutual agreements between the
partners, and without a corporate name
indicating to the public in some way that there
were other people besides the one who
ostensibly managed and conducted the
business, is exactly the accidental partnership
of cuentas en participacion defined in article
239 of the Code of Commerce.
Those who contract with the person
under whose name the business of such
partnership of cuentas en participacion is
conducted, shall have only a right of action
against such person and not against the other
persons interested, and the latter, on the other
hand, shall have no right of action against the
third person who contracted with the manager
unless such manager formally transfers his right
to them. (Art 242 of the code Of Commerce.) It
follows, therefore that the plaintiff has no right
to demand from the appellants the payment of
the amount claimed in the complaint, as LoChim-Lim was the only one who contracted with
him. the action of the plaintiff lacks, therefore, a
legal foundation and should be accordingly
dismissed.
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as
to
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Assurance
vs.
Ingersoll
G.R.
Held:
(again, historical background lang to ng
Insolvency Law) Now, it is a well-known fact in
our legislative history that the Insolvency Law
(Act No. 1956) is in great part a copy of the
Insolvency Act of California, enacted in 1895,
though it contains a few provisions from the
American Bankruptcy Law of 1898 (see
observation of Justice Trent in Mitsui Bussan
Kaisha vs. Hongkong and Shanghai Banking
Corporation, 36 Phil., 27, 37). Again, upon
comparing the California Insolvency Law of
1895 with the American Bankruptcy Act of
1867, it will be found that the former contains
much in common with the latter; and among
the provisions common to the Bankruptcy Act of
1867, the California Insolvency Law of 1895,
and the Insolvency Law in force in these Islands
(Act No. 1956), is precisely the provision which
appears as SEC 32 of our Act, defining the
property which passes as assets to the assignee
in insolvency. (Bankruptcy Act of 1867, sec. 14;
California Insolvency Law of 1895, sec. 21;
Philippine Insolvency Law, sec. 32.)
Under each of said laws the assignee
acquires all the real and personal property,
estate, and effects of the debtor, not exempt by
law from execution, with all deeds, books and
papers relating thereto; and while this language
is
broad,
it
nevertheless
lacks
the
comprehensiveness of SEC 70 (a) of the
American Bankruptcy Law of 1898 in the least
two particulars; for under subSEC 3 of SEC 70
(a) of the last mentioned law, the trustee in
bankruptcy acquires the right to exercise any
powers which the insolvent might have
exercised for his own benefit, and under subSEC
5 the trustee acquires any property of the
insolvent which the latter could by any means
have assigned to another. The Insolvency Law
here in force, in common with the predecessor
laws above-mentioned, contains nothing similar
to these provisions.
14.3 Applicability to banks, quasi banks,
and insurance companies
The Insolvency law is NOT applicable to banks,
quasi-banks, and insurance companies.
SUSPENSION OF PAYMENTS
Nature
Who could file petition
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by
agreement
on
Consequences of debtors
perform agreement
failure
to
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f. liquidation
g.
h.
i.
of assets and
payment of debts
discharge of the debtor
objections to discharge, if any
appeal to the Supreme Court
in certain cases.
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INVOLUNTARY INSOLVENCY
Nature
Who could file petition
Must be accompanied by bond
Acts of insolvency
SEC 20. An adjudication of insolvency may be
made on the petition of three or more
creditors, residents of the Philippine Islands,
whose credits or demands accrued in the
Philippine Islands, and the amount of which
credits or demands are in the aggregate not
less than one thousand pesos: Provided, That
none of said creditors has become a creditor by
assignment, however made, within thirty days
prior to the filing of said petition. Such petition
must be filed in the Court of First Instance of
the province or city in which the debtor resides
or has his principal place of business, and must
be verified by at least three of the petitioners.
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of
insolvents
property
to
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14.8 Cases
Application of Civil Code provisions
concurrence and preference of credits
on
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Held:
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Additional materials
Articles 29-33 RA 7653
SEC 29. Appointment of Conservator.
Whenever, on the basis of a report submitted
by the appropriate supervising or examining
department, the Monetary Board finds that a
bank or a quasi-bank is in a state of continuing
inability or unwillingness to maintain a condition
of liquidity deemed adequate to protect the
interest of depositors and creditors, the
Monetary Board may appoint a conservator
with such powers as the Monetary Board shall
deem necessary to take charge of the assets,
liabilities, and the management thereof,
reorganize the management, collect all monies
and debts due said institution, and exercise all
powers necessary to restore its viability. The
conservator shall report and be responsible to
the Monetary Board and shall have the power to
overrule or revoke the actions of the previous
management and board of directors of the bank
or quasi-bank.
The conservator should be competent and
knowledgeable
in
bank
operations
and
management. The conservatorship shall not
exceed one (1) year.
The conservator shall receive remuneration to
be fixed by the Monetary Board in an amount
not to exceed two-thirds (2/3) of the salary of
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Insurance Code
Title
13
SUSPENSION OR REVOCATION OF AUTHORITY
Sec. 247. If the Commissioner is of the opinion
upon examination of other evidence that any
domestic or foreign insurance company is in an
unsound condition, or that it has failed to
comply with the provisions of law or regulations
obligatory upon it, or that its condition or
method of business is such as to render its
proceedings hazardous to the public or to its
policyholders, or that its paid-up capital stock,
in the case of a domestic stock company, or its
available cash assets, in the case of a domestic
mutual company, or its security deposits, in the
case of a foreign company, is impaired or
deficient, or that the margin of solvency
required of such company is deficient, the
Commissioner is authorized to suspend or
revoke all certificates of authority granted to
such insurance company, its officers and
agents, and no new business shall thereafter be
done by such company or for such company by
its agent in the Philippines while such
suspension, revocation or disability continues or
until its authority to do business is restored by
the Commissioner. Before restoring such
authority, the Commissioner shall require the
company concerned to submit to him a
business plan showing the company's estimated
receipts and disbursements, as well as the basis
therefor, for the next succeeding three years.
(As amended by Presidential Decree No. 1455).
Title
14
APPOINTMENT OF CONSERVATOR
Sec. 248. If at any time before, or after, the
suspension or revocation of the certificate of
authority of an insurance company as provided
in the preceding title, the Commissioner finds
that such company is in a state of continuing
inability or unwillingness to maintain a condition
of solvency or liquidity deemed adequate to
protect the interest of policy holders and
creditors, he may appoint a conservator to take
charge
the
assets, liabilities, and the
management of such company, collect all
moneys and debts due said company and
exercise all powers necessary to preserve the
assets of said company, reorganize the
management thereof, and restore its viability.
The said conservator shall have the power to
overrule or revoke the actions of the previous
management and board of directors of the said
company, any provision of law, or of the articles
of incorporation or by-laws of the company, to
the contrary notwithstanding, and such other
powers as the Commissioner shall deem
necessary.
The conservator may be another
insurance company doing business in the
Philippines, by officer or officers of such
company, or any other competent and qualified
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CORPORATE REHABILITATION
SC Rules Procedure on Corporate Rehabilitation
(AM No. 00-8-10-SC)
Definitions of
(Rule 2)
P.D. 1529
SEC 83. Notice of insolvency. Whenever
proceeding in bankruptcy or insolvency, or
analogous proceedings, are instituted against a
debtor who owns registered land, it shall be the
duty of the officer serving the notice of the
institution of such proceedings on the debtor to
file a copy thereof with the office of the Register
of Deeds for the province or city where the land
of the debtor lies. The assignee or trustee
appointed by the court in such proceedings
shall be entitled to the entry of a new certificate
of the registered land of the debtor or bankrupt,
upon presenting and filing a certified copy of
the assignment in insolvency or order or
adjudication in bankruptcy with the insolvent's
or bankrupt's duplicate certificate of title; but
the new certificate shall state that it is entered
to him as assignee in insolvency or trustee in
bankruptcy or other proceedings, as the case
may be.
SEC 84. Judgment or order vacating
insolvency proceedings. Whenever any of
the proceedings of the character named in the
preceding SEC against a registered owner, of
which notice has been registered, is vacated by
judgment, a certified copy of the judgment or
order may be registered. Where a new
certificate has been entered in the name of the
assignee or trustee, such certificate shall be
surrendered for cancellation and forthwith the
debtor shall be entitled to the entry of a new
certificate to him.
Coverage (Rule 1)
These Rules shall apply to petitions for
rehabilitation of corporations, partnerships and
associations pursuant to Presidential Decree No.
902-A.
terms
and
construction
Administrative Expenses
(a) Reasonable and necessary expenses
that are incurred in connection with the filing of
the petition;
(b) Expenses incurred in the ordinary
course of business after the issuance of the
stay order
- excluding interest payable to the creditors for
loans and credit accommodations existing at
the time of the issuance of the stay order; and
(c) Other expenses that are authorized under
this Rules.
"Claim"
Include all claims or demands of whatever
nature or charter against a debtor or its
property, whether for money or otherwise
"Control"
Power of a parent corporation to direct or
govern the financial and operating policies of an
enterprise so as to obtain benefits from its
activities.
Control is presumed to exit when:
a. parent owns, directly or indirectly though
subsidiaries, more than one - half () of the
voting power of the voting power of an
enterprise unless, such ownership does not
constitute control.
b. parents owns one-half (1/2) or less of the
voting power of an enterprise when there is
power.
a. Over more than one-half () of agreement
with investors;
b. To direct or govern the financial and
operating policies of the enterprise under a
statute or agreement;
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"Subsidiary"
A corporation where more than fifty percent
(50%) of its voting stock is owned or controlled
directly or indirectly by another corporation.
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Prohibition
against
disposition
and
encumbrances of property (Sec 7.c)
-the debtor cannot sell, encumber, transfer, or
dispose in any manner any of its properties
except in the ordinary course of business;
Prohibition against payment of prepetition liabilities (Sec 7.d)
-the debtor cannot make any payment on its
liabilities except as provided in items (e), (f) and
(g) of this SEC or when ordered by the court
pursuant to SEC 10 of Rule 3;
Prohibition against withholding of goods
and services (Sec 7.e)
-the debtor's suppliers of goods or services
cannot withhold supply of goods and services in
the ordinary course of business for as long as
the debtor makes payments for the services
and goods supplied after the issuance of the
stay order;
Payment of post-petition administrative
expenses (Sec 7.f)
-payment in full of all administrative expenses
incurred after the issuance of the stay order;
Payment of post-petition credits (Sec 7.g)
direct the payment of new loans or other forms
of credit accommodations obtained for the
rehabilitation of the debtor with prior court
approval;
Preservation of claims against debtor (Sec
7 last par)
The issuance of a stay order does not affect the
right to commence actions or proceedings
insofar as it is necessary to preserve a claim
against the debtor.
Concept
of
Adequate
Protection
of
Property (Sec 10)
the creditor lacks adequate protection if it can
be shown that:
(1) The debtor fails or refuses to honor a preexisting agreement with the to keep the
property insured;
(2) The debtor fails or refuses to take
commercially reasonable steps to maintain the
property; or
(3) The property has depreciated to an extent
that the creditor is undersecured
Qualifications
and
Disqualification
of
Rehabilitation Receiver (Sec 11)
Qualifications:
(1) Expertise and acumen to manage and
operate a business similar in size and
complexity to that of the debtor;
(2) Knowledge in management, finance and
rehabilitation of distressed companies;
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Cases:
Equality is Equity
Alemars Sibal & Sons, Inc. vs. Elbinias,
et.al.,
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Administrative
Agency.
4.1.
- This Code is administered by SEC as collegial
body composed of Chairperson and 4
Commissioners
- appointed by Pres for term of 7y ea
- who serve as such until successor is appointed
& qualified
- Commissioner appointed to fill vacancy prior
to expiration of term for w/c his / her
predecessor was appointed, serves only for
unexpired portion of term.
Unless
context
indicates
otherwise,
Commissioner incl Chairperson.
4.2.
- Commissioners must be
- natural-born citizens
- at least 40y for Chairperson and at least 35y
for Commissioners
- of good moral character
- of unquestionable integrity
- of known probity & patriotism
- w/ recognized competence in social &
economic disciplines
- Majority of Commissioners, incl Chairperson,
shall be members of Phil Bar.
4.3.
- Chairperson is CEO of the Commission.
- Chairperson shall
- execute & administer policies, decisions,
orders, resolutions approved by Commission
AND
- have gen executive direction & supervision of
work & operation of Commission and its
members, bodies, boards, offices, personnel,
and all admin biz
4.4.
- Salary of Chairperson & Commissioners shall
be
- fixed by Pres
- based on objective classification system
- at a sum comparable to members of Monetary
Board and commensurate to importance
attached to position
4.5.
- Commission holds mtgs at least once a wk OR
as often as necessary upon call of Chairperson
or upon request of 3 Commissioners.
- Notice of mtg is given to all Commissioners
and presence of 3 Commissioners constitutes
quorum. In absence of Chairperson, the most
senior Commissioner acts as presiding officer.
4.6.
- Commission may delegate any of its fcns to
any dept / ofc of the Commission, an individual
Commissioner or staff member of Commission
except its
- rvw / appellate authority AND
- power to adopt, alter, supplement any rule
- Commission may rvw upon own initiative or
upon petition of party any action of dept / ofc,
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&
qualification
standards
approved
by
Commission based on comprehensive job
analysis
&
audit
of
actual
duties
&
responsibilities.
- Compensation plan shall be
- comparable w/ prevailing plan in Bangko
Sentral and other govt financial institutions
AND
- subject to periodic rvw by Commission no
more than once every 2y w/o prejudice to
yearly merit rvws / increases based on
productivity & efficiency.
- Commission shall be exempt fr laws, rules,
regulations
on
compensation,
position
classification, qualification standards.
- Commission shall endeavor to make its system
conform as closely as possible w/ Compensation
& Position Classification Act of 1989.
Sec 76, RA 8799
Repealing Clause.
- Revised Securities Act (BP 178) in its entirety
AND Sec 2, 4, 8 of PD 902A as amended, are
repealed.
- All other laws, orders, rules, regulations, or
parts thereof, inconsistent w/ this Code are
repealed or modified.
Powers and Functions
Sec 3.
Commission
has
absolute
jurisdiction,
supervision, control over all corps, partnerships,
assns, who are grantees of primary franchise
and / or license or permit issued by govt to
operate in Phils
- It has power to enlist aid of any and all
enforcement agencies of govt, civil or military.
Sec 6.
- Commission has ff powers:
a.
issue prelim / permanent injunctions,
prohibitory / mandatory, where it has
jurisdiction
(RoC
shall
apply)
b. punish for contempt of Commission, direct &
indirect,
in
accordance
w/
RoC
c. compel officers of corp / assn registered by it
to call mtgs of stockholders / members under its
supervision
d. pass upon validity of issuance & use of
proxies & voting trust agreements for absent
stockholders
/
members
e. issue subpoena duces tecum and summon
witnesses to appear in proceedings of
Commission; in appropriate cases order search
& seizure or cause search & seizure of docs,
papers, files, records, books of accts of entity
under
investigation
f. impose fines and / or penalties for violation of
this Decree, laws implemented by Commission,
rules,
etc
g. authorize establishment of stock exchanges,
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f. impose sanctions
g.
prepare, approve, amend, repeal rules,
regulations, orders; issue opinions, provide
guidance on and supervise compliance w/ such
rules
h. enlist aid of and / or deputize enforcement
agencies of govt, civil or military as well as pvt
institution, corp, firm, assn or person in
implementation
i. issue cease & desist orders
j. punish for contempt of Commission, direct &
indirect, in accordance w/ RoC
k. compel officers of corp or assn to call mtgs
of stockholders / members under its supervision
l.
issue subpoena duces tecum, summon
witnesses to appear in proceedings of
Commission, order exam, search, seizure of
docs, papers, files, records, tax returns, books
of accts of entity under investigation
m. suspend, revoke, after notice & hearing the
franchise / cert of registration of corp,
partnership, assn, upon grounds provided by
law
n. exercise other powers provided by law as
well as those implied fr, or w/c are necessary /
incidental to express powers
XXX
Jurisdiction
Sec 5, RA 8799
Powers and Functions of the Commission.
XXX
5.2.
- Commissions jurisdiction over cases under
Sec 5 PD 902A is transferred to Courts of gen
jurisdiction OR RTC.
- SC may designate RTC branches that exercise
jurisdiction over these cases.
Cases
Prof Catindig:
Read Espino and Easycall cases together. Read
Cualoping and Provident cases together.
Compare and contrast.
REMOVAL
FROM
EMPLOYMENT
OF
CORPORATE
OFFICERS
NOT
WITHIN
JURISDICTION OF NLRC
Espino v. NLRC
- A corporate officer's dismissal is always
corporate act and / or intra-corporate
controversy.
That nature isnt altered by
reason / wisdom w/c Board may have in taking
such action.
- That Espino sought payment of backwages,
other benefits, moral & exemplary damages,
atty's fees in complaint for illegal dismissal will
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OF
MANAGEMENT
For
minority
stockholder
to
obtain
appointment of interim mgmt committee, he
must do more than merely make prima facie
showing of denial of his right to share in
concerns of the corp. He must show that the
corporate prop is in danger of being wasted &
destroyed and the biz of the corp is being
diverted fr the purpose for w/c it has been
organized and there is serious paralization of
operations all to his detriment.
- Its only in strong case where theres showing
that the majority are clearly violating chartered
rights of minority and putting their interests in
imminent danger that mgmt committee may be
created.
Mere
disagreement
among
stockholders as to affairs of corp wouldnt in
itself suffice as ground for appointment of
mgmt committee.
- At least where theres no imminent danger of
loss of corporate prop or of any other injury to
stockholders, mgmt of corporate biz shldnt be
wrested away fr duly elected officers, who are
prima facie entitled to administer affairs of corp
and placed in the hands of mgmt committee.
However,
where
dissension
among
stockholders is such that the corp cant
successfully carry on corporate fcns the
appointment of mgmt committee becomes
imperative.
APPOINTMENT
OF
COMMITTEE NOT VALID
MANAGEMENT
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Punongbayan v. Punongbayan
- A mgmt committee is tasked to manage, take
custody of and control existing assets, funds,
records of corp AND to determine the best way
to protect interest of stockholders & creditors.
- Having the power to create mgmt committee,
it follows that RTC can order reorganization of
existing mgmt committee. Such appointment
of new members doesnt mean creation of new
mgmt committee. Existing mgmt committee
wasnt abolished.
OF
BROKERS
NICOLAS vs. CA
G.R. No. 122857
27 March 1998
RTC granted. CA dismissed.
Ao-As v. CA
- Appointment of mgmt committee inevitably
results in drastic summary removal of all
directors & officers.
- Where the corp is solvent, rcver will not be
appointed bec of past misconduct and
subsequent mere apprehension of future
misdoing,
where
present
situation
and
prospects for the future are not such as to
warrant receivership.
- Gen rule: Rcver or mgmt committee will not
be appointed unless necessary either to
prevent fraud, or to save prop fr fraud /
threatened destruction, or at least in case of
solvent corporation. The burden of proof is
heavy one w/c requires clear showing that
emergency exists.
Similarly, rcver / mgmt
committee shldnt be appointed in action by
minority stockholder against corporate officers
for accounting where corp is solvent and going
concern and rcver isnt necessary to preserve
corporate prop pending accounting.
- Mgmt committee shldnt be created when
there was adequate remedy available to pvt
respondents for liquidation of unaccounted
funds. Appointment of rcver for going corp is
last resort remedy, and shldnt be employed
when another remedy is available.
POWER
TO
CREATE
COMMITTEE
INCLUDES
REORGANIZE THE SAME
MANAGEMENT
POWER
TO
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ABACUS SECURITIES
AMPIL
G.R. No. 160016
27 February 2006
CORPORATION
vs.
Facts:
Abacus is engaged in business as a broker and
dealer of securities of listed companies at the
Philippine Stock Exchange Center.
On April 8, 1997, Ampil opened a cash account
with Abacus for his transactions in securities;
Ampils purchases were consistently unpaid
from April 10 to 30, 1997;
Ampil failed to pay in full, or even just his
deficiency, for the transactions on April 10 and
11, 1997;
Despite Ampils failure to cover his initial
deficiency, Abacus subsequently purchased and
sold securities for Ampils account on April 25
and 29;
Abacus did not cancel or liquidate a substantial
amount of Ampils stock transactions until May
6, 1997.
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XVII.
INTELLECTUAL PROPERTY
CODE
RA 8923 (1997), AS AMENDED BY RA
9150 (2001)
THE TRIPS AGREEMENT
17.1 Topics
International Agreements on Intellectual
Property
a. Paris Convention (1883) Protection of
Industrial Property
b. Berne Convention (1896) Protection of
Literary and Artistic Works
c. Madrid Agreement (1891) Repression
of False or Deceptive Indications of
Source of Goods
d. Madrid Agreement (1891) International
Registration of Marks
e. Hague Agreement (1925) International
Deposit of Industrial Designs
f. Nice Agreement (1957) International
Classification of Goods and Services for
the Purposes of the Registration of Marks
g. Lisbon Agreement (1958) Protection of
Appellations
of
Origin
and
their
International Registration
International
Classification
of
the
Figurative Elements of Marks
n. Brussels
Convention
(1974)
Distribution
of
Programme-Carrying
Signals Transmitted by Satellite
o. Budapest Treaty (1977) deposit of
microorganisms for purposes of patent
procedure
p. Nairobi Treaty (1981) Protection of
Olympic Symbol
q. Washington Treaty (1989) Intellectual
Property in Respect of Integrated
Circuits
r. Protocol on Madrid Agreement (1989)
International Registration of Marks
s. Trademark Law Treaty (1994) make
registration systems
t. WIPO
Copyright
Treaty
(1996)
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No
of
(4)
for
INTELLECTUAL
GENERAL
PROPERTY
RIGHTS
IN
PATENTS
17.5 Topics
Patentable Inventions
SEC 21. Patentable Inventions. - Any technical
solution of a problem in any field of human
activity which is new, involves an inventive step
and is industrially applicable shall be
Patentable. It may be, or may relate to, a
product, or process, or an improvement of any
of the foregoing. (Sec. 7, R.A. No. 165a)
Novelty
SEC 23. Novelty. . - An invention shall not be
considered new if it forms part of a prior art.
(Sec. 9, R.A. No. 165a)
Prior Art
SEC 24. Prior Art. - Prior art shall consist of:
24.1. Everything which has been made
available to the public anywhere in the world,
before the filing date or the priority date of the
application claiming the invention; and
24.2. The whole contents of an application for a
patent, utility model, or industrial design
registration, published in accordance with this
Act, filed or effective in the Philippines, with a
filing or priority date that is earlier than the
filing or priority date of the application:
Provided, That the application which has validly
claimed the filing date of an earlier application
under SEC 31 of this Act, shall be prior art with
effect as of the filing date of such earlier
application: Provided further, That the applicant
or the inventor identified in both applications
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Term
SEC 60. Form and Publication of Amendment. An amendment or correction of a patent shall
be accomplished by a certificate of such
amendment or correction, authenticated by the
seal of the Office and signed by the Director,
which certificate shall be attached to the
patent. Notice of such amendment or correction
shall be published in the IPO Gazette and copies
of the patent kept or furnished by the Office
shall include a copy of the certificate of
amendment or correction. (Sec. 27, R.A. No.
165)
Rights Conferred by a Patent
SEC 71. Rights Conferred by Patent. - 71.1. A
patent shall confer on its owner the following
exclusive rights:
[RPP-MUSI-MDUSOSI-ATL]
(a) Where the subject matter of a patent is a
product, to restrain, prohibit and prevent any
unauthorized person or entity from making,
using, offering for sale, selling or importing that
product;
(b) Where the subject matter of a patent is a
process, to restrain, prevent or prohibit any
unauthorized person or entity from using the
process, and from manufacturing, dealing in,
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Patent Infringement
SEC 76. Civil Action for Infringement. - 76.1.
The making, using, offering for sale, selling, or
importing a patented product or a product
obtained directly or indirectly from a patented
process, or the use of a patented process
without the authorization of the patentee
constitutes patent infringement. [MUOSIUWA]
Civil Action
SEC 76. Civil Action for Infringement. - 76.1.
The making, using, offering for sale, selling, or
importing a patented product or a product
obtained directly or indirectly from a patented
process, or the use of a patented process
without the authorization of the patentee
constitutes patent infringement.
[DAIDC]
76.2. Any patentee, or anyone possessing any
right, title or interest in and to the patented
invention, whose rights have been infringed,
may bring a civil action before a court of
competent jurisdiction, to recover from the
infringer such damages sustained thereby, plus
attorney's fees and other expenses of litigation,
and to secure an injunction for the protection of
his rights.
76.3. If the damages are inadequate or cannot
be
readily
ascertained
with
reasonable
certainty, the court may award by way of
damages a sum equivalent to reasonable
royalty.
76.4. The court may, according to the
circumstances of the case, award damages in a
sum above the amount found as actual
damages sustained: Provided, That the award
does not exceed three (3) times the amount of
such actual damages.
76.5. The court may, in its discretion, order that
the infringing goods, materials and implements
predominantly used in the infringement be
disposed of outside the channels of commerce
or destroyed, without compensation.
76.6. Anyone who actively induces the
infringement of a patent or provides the
infringer with a component of a patented
product or of a product produced because of a
patented process knowing it to be especially
adopted for infringing the patented invention
and not suitable for substantial non-infringing
use shall be liable as a contributory infringer
and shall be jointly and severally liable with the
infringer. (Sec. 42, R.A. No. 165a)
Defenses
[FKI]
SEC 79. Limitation of Action for Damages. - No
damages can be recovered for acts of
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Compulsory Licensing
Ground for Grant of Compulsory License
SEC 93. Grounds for Compulsory Licensing. The Director of Legal Affairs may grant a license
to exploit a patented invention, even without
the agreement of the patent owner, in favor of
any person who has shown his capability to
exploit the invention, under any of the following
circumstances:
[NPJPN]
93.1.
National
emergency
or
other
circumstances of extreme urgency;
93.2. Where the public interest, in particular,
national security, nutrition, health or the
development of other vital sectors of the
national economy as determined by the
appropriate agency of the Government, so
requires; or
93.3. Where a judicial or administrative body
has determined that the manner of exploitation
by the owner of the patent or his licensee is
anti-competitive; or
93.4. In case of public non-commercial use of
the patent by the patentee, without satisfactory
reason;
93.5. If the patented invention is not being
worked in the Philippines on a commercial
scale, although capable of being worked,
without satisfactory reason: Provided, That the
importation of the patented article shall
constitute working or using the patent. (Secs.
34, 34-A, 34-B, R.A. No. 165a)
Terms and Conditions of Grant
SEC 100. Terms and Conditions of Compulsory
License. - The basic terms and conditions
including the rate of royalties of a compulsory
license shall be fixed by the Director of Legal
Affairs subject to the following conditions:
[SNNPTP]
100.1. The scope and duration of such license
shall be limited to the purpose for which it was
authorized;
100.2. The license shall be non-exclusive;
100.3. The license shall be non-assignable,
except with that part of the enterprise or
business with which the invention is being
exploited;
100.4. Use of the subject matter of the license
shall be devoted predominantly for the supply
of the Philippine market: Provided, That this
limitation shall not apply where the grant of the
license is based on the ground that the
patentee's manner of exploiting the patent is
determined by judicial or administrative
process, to be anti-competitive.
100.5. The license may be terminated upon
proper showing that circumstances which led to
its grant have ceased to exist and are unlikely
to recur: Provided, That adequate protection
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INDUSTRIAL
DESIGNS
AND
DESIGNS
(TOPOGRAPHIES)
INTEGRATED CIRCUITS
LAYOUT
OF
17.7 Topics
Definitions
of
Industrial
Design,
Integrated Circuits and Layout Design
SEC. 112. Definition of Terms:"
"1. An Industrial Design is any composition of
lines or colors or any three-dimensional form,
whether or not associated with lines or colors:
Provided, That such composition or form gives a
special appearance to and can serve as pattern
for an industrial product or handicraft;
"2. Integrated Circuit means a product, in its
final form, or an intermediate form, in which the
elements, at least one of which is an active
element and some or all of the interconnections
are integrally formed in and/or on a piece of
material, and which is intended to perform an
electronic function; and
"3.
Layout-Design
is
synonymous
With
'Topography' and means the three-dimensional
disposition,
however
expressed,
of
the
elements, at least one of which is an active
element, and of some or all of the
interconnections of an integrated circuit, or
such a three-dimensional disposition prepared
for
an
integrated
circuit
intended
for
manufacture.
Substantive Conditions for Protection
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services, or
(iii) If it nearly resembles such a mark as to be
likely to deceive or cause confusion;
Notes:
- How to determine if there is confusing
similarity between the marks
o The
labels,
packages
or
containers are presented for
examination and comparison.
o Where they are not presented,
then the spelling, sound or
pronunciation of the marks may
be resorted to. Similarity of sound
or
pronunciation
may
be
sufficient to make two marks
confusingly similar.
- TEST OF DOMINANCY: Focuses not
simply on similarities in size, form or
color but on the main or essential
features of each mark, taken together.
The test requires that if the competing
trademark contains the main or essential
features of another and confusion and
deception is likely to result, infringement
takes place. Duplication or imitation is
not necessary.
- HOLISTIC TEST: Considers the mark as a
whole and not as dissected. If the buyer
is deceived, it is attributable to the mark
as a totality, not usually to any part of it.
- RELATED GOODS PRINCIPLE: Goods are
related when they belong to the same
class or have the same descriptive
properties or physical attributes, or they
serve the same purpose or flow through
the same channel of trade. It is held that
the use of identical marks on noncompeting and unrelated goods is not
likely to cause confusion.
Cases:
Holistic Test
Del Monte Corporation et. al. vs. CA and
Sunshine Sauce Manufacturing Industry (1990)
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Well-known marks
e.
f.
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Disclaimer
Priority Right
Term
Sec.
145.
DurationA
certificate
of
registration shall remain in force for ten (10)
years: Provided, That the registrant shall file a
declaration of actual use and evidence to that
effect, or shall show valid reasons based on the
existence of obstacles to such use, as
prescribed by the Regulations, within one (1)
year from the fifth anniversary of the date of
the registration of the mark. Otherwise, the
mark shall be removed from the Register by the
Office. (Sec. 12, R.A. No. 166a)
Rights conferred by registration
Sec. 147. Rights Conferred
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o
o
Damages
Notes:
- To bring a civil action for infringement, it
is not required that there be an actual
sale of the goods or services using the
infringing material. Infringement takes
place upon the mere use or reproduction
of the registered mark.
Sec. 156. Actions, and Damages
Injunction for Infringement
and
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Notice Requirement
Nature of
offense
Fraudulent
Intent
Need
for
Registratio
n
Infringement of
Trademark
Unauthorized
use
of
a
trademark
Not necessary
Prior registration
is a pre-requisite
Unfair
Competition
Passing
off
ones goods as
that of another
Essential
element
Registration is
not necessary
Rights,
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Copyrightable works
Original works
SEC. 172. Literary and Artistic Works
172.1 Literary and artistic works, hereinafter
referred to as "works", are original intellectual
creations in the literary and artistic domain
protected from the moment of their creation
and shall include in particular:
(a) Books, pamphlets, articles and other
writings;
(b) Periodicals and newspapers;
(c) Lectures, sermons, addresses,
dissertations prepared for oral delivery, whether
or not reduced in writing or other material form;
(d) Letters;
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Derivative works
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Non-Copyrightable works
SEC. 175. Unprotected Subject Matter
Notwithstanding the provisions of SEC 172 and
173, no protection shall extend, under this law,
to any idea, procedure, system method or
operation, concept, principle, discovery or mere
data as such, even if they are expressed,
explained, illustrated or embodied in a work;
news of the day and other miscellaneous facts
having the character of mere items of press
information; or any official text of a legislative,
administrative or legal nature, as well as any
official translation thereof. (n)
SEC. 176. Works of the Government
176.1. No copyright shall subsist in any work of
the Government of the Philippines. However,
prior approval of the government agency or
office wherein the work is created shall be
necessary for exploitation of such work for
profit. Such agency or office may, among other
things, impose as a condition the payment of
royalties. No prior approval or conditions shall
be required for the use of any purpose of
statutes, rules and regulations, and speeches,
lectures, sermons, addresses, and dissertations,
pronounced, read or rendered in courts of
justice, before administrative agencies, in
deliberative assemblies and in meetings of
public character. (Sec. 9, first par., P.D. No. 49)
176.2. The Author of speeches, lectures,
sermons,
addresses,
and
dissertations
mentioned in the preceding paragraphs shall
have the exclusive right of making a collection
of his works. (n)
176.3.
Notwithstanding
the
foregoing
provisions, the Government is not precluded
from
receiving
and
holding
copyrights
transferred to it by assignment, bequest or
otherwise; nor shall publication or republication
by the government in a public document of any
work in which copy right is subsisting be taken
to cause any abridgment or annulment of the
3. Droit de suite
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Right to proceeds
transfers or droite de suite
of
subsequent
Moral Rights
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SEC. 189.
Program
of
Reproduction
Computer
Cases:
-
Copyright infringement
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excerpts
for
reporting
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